Tender Offer (5854A)

TIDM65DV

RNS Number : 5854A

CHESS Capital Securities plc

02 February 2011

NOT FOR DISTRIBUTION IN OR INTO OR TO ANY PERSON LOCATED OR RESIDENT IN THE UNITED STATES, ITS TERRITORIES AND POSSESSIONS (INCLUDING PUERTO RICO, THE U.S. VIRGIN ISLANDS, GUAM, AMERICAN SAMOA, WAKE ISLAND AND THE NORTHERN MARIANA ISLANDS), ANY STATE OF THE UNITED STATES OR THE DISTRICT OF COLUMBIA, TO ANY U.S. PERSON OR TO ANY PERSON LOCATED OR RESIDENT IN ITALY (SEE "OFFER AND DISTRIBUTION RESTRICTIONS" BELOW)

2nd February, 2011

CHESS Capital Securities plc announces Tender Offer for any and all of the outstanding EUR125,000,000 Perpetual Tier-One Pass-Through Securities (ISIN: XS0225592145)

CHESS Capital Securities plc (Chess or the Company) announced today an invitation to holders of its outstanding EUR125,000,000 Perpetual Tier-One Pass-Through Securities (the Notes) to tender any and all of their Notes for purchase by the Company for cash (theOffer). The Offer is being made on the terms and subject to the conditions contained in the Tender Offer Memorandum dated 2nd February, 2011 (the Tender Offer Memorandum) prepared by the Company, and is subject to the offer restrictions set out below and as more fully described in the Tender Offer Memorandum.

Copies of the Tender Offer Memorandum are (subject to distribution restrictions) available from the Dealer Manager and the Tender Agent as set out below. Capitalised terms used in this announcement but not defined have the meanings given to them in the Tender Offer Memorandum.

Rationale

On 28th November, 2010, the Central Bank of Ireland announced that it set a new minimum capital requirement of 10.5 per cent. core tier-1. In addition, the Central Bank requires EBS Building Society (EBS) to raise sufficient capital to achieve a capital ratio of at least 12 per cent. core tier-1 by 28th February, 2011. The Central Bank will require this additional capital to be in the form of reserves, equity or equivalent instruments for EBS.

As a result of the increased core capital requirements, the EBS group is seeking to augment its existing core tier-1 capital base by purchasing any and all of the existing non-core tier-1 capital instruments originated from within the EBS group at a price below their par value.

Accordingly, the rationale for undertaking the Offer is to create additional core tier-1 capital and to strengthen the quality of the capital base of EBS. The Offer is a voluntary, market-based approach which affords a choice to Noteholders and reflects the current distressed trading levels of the Notes. The Notes currently trade at a significant discount compared to their initial issue price.

Details of the Offer

 
                                                               Amount 
                                                              held by 
                                                             Chess as 
                                                             security       Amount    Purchase 
                                  Original   Outstanding      for the      held by       Price 
                                    amount        amount        Notes    EBS Group        (per 
                   ISIN              (EUR)        (EUR)*       (EUR)*       (EUR)*   EUR1,000) 
------------  --------------  ------------  ------------  -----------  -----------  ---------- 
 Notes         XS0225592145    125,000,000    37,853,000            -            -      EUR175 
 Capital 
  Securities         -         125,000,000   125,000,000   37,853,000   87,147,000           - 
------------  --------------  ------------  ------------  -----------  -----------  ---------- 
 

* Pursuant to a tender offer which concluded on 23rd June, 2010, EUR87 147,000 in principal amount of the Notes was repurchased and cancelled by the Company and Capital Securities having an aggregate liquidation preference of EUR87,147,000 were purchased from the Company, and are currently held, by EBS. Those Capital Securities purchased from the Company by EBS were simultaneously released from the security package for the Notes.

Subject to the satisfaction of the Settlement Condition (as defined below), the Company will pay EUR175 for each EUR1,000 in principal amount of the Notes accepted by it for purchase pursuant to the Offer (the Purchase Price). The Company will not pay any amount in respect of accrued interest on the Notes.

The outstanding EUR37,853,000 principal amount of Notes are secured over EUR37,853,000 4.830% Step-up Guaranteed Non-Cumulative Perpetual Capital Securities of EBS Capital No.1 S.A. (the Capital Securities). Pursuant to a capital securities purchase agreement entered into by Haven Mortgages Limited (Haven), a wholly-owned subsidiary of EBS, The Bank of New York Mellon (the Trustee) and the Company dated the date of the Tender Offer Memorandum (the Capital Securities Purchase Agreement), Haven has committed to purchase from the Company, Capital Securities with an aggregate nominal liquidation preference equal to the aggregate principal amount of Notes accepted for purchase by the Company pursuant to the Offer. Settlement of the Offer by the Company is subject to receipt of the sale proceeds of the Capital Securities from Haven (the Settlement Condition).

The Offer begins today, 2nd February, 2011 (the Launch Date) and will expire at 5.00 p.m. (London time) on 23rd February, 2011 (the Expiration Deadline), unless extended, re-opened or terminated as provided in the Tender Offer Memorandum. The relevant deadline set by any intermediary or Clearing System may be earlier than this deadline.

Subject to applicable law and as provided in the Tender Offer Memorandum the Company may, in its sole discretion (to be exercised with the consent of Haven), extend, re-open, amend, waive any condition of or terminate the Offer at any time. Details of any such extension, re-opening, amendment or termination will be announced as provided in the Tender Offer Memorandum as soon as reasonably practicable after the relevant decision is made.

Tender Instructions

In order to be eligible to receive the Purchase Price, Noteholders must validly tender their Notes by the Expiration Deadline, by delivering, or arranging to have delivered on their behalf, a valid Tender Instruction that is received by the Tender Agent by the Expiration Deadline. Tender Instructions will be irrevocable except in the limited circumstances described in the Tender Offer Memorandum.

Tender Instructions must be submitted in respect of a minimum principal amount of Notes of EUR50,000 and integral multiples of EUR1,000 in excess thereof, and may only be submitted via Euroclear or Clearstream, Luxembourg. Accordingly, to the extent any holders holding their Notes through clearing systems other than Euroclear or Clearstream, Luxembourg wish to participate in the Offer, they should speak to the custodian or clearing system through which their Notes are held as soon as possible as regards the possibility of such custodian or clearing system submitting Tender Instructions via Euroclear or Clearstream, Luxembourg on their behalf, and may need to arrange for the Notes to be transferred to a direct participant within Euroclear or Clearstream, Luxembourg in order to submit such Tender Instructions.

Indicative Timetable for the Offer

The following sets out the expected dates and times of the key events relating to the Offer. This is an indicative timetable and is subject to change.

 
 Date and time (all times   Number of Business Days    Event 
 are London times)          from and including 
                            Launch Date 
 Wednesday, 2nd February,   Day 1                      Launch Date Execution 
 2011                                                  of the Capital 
                                                       Securities Purchase 
                                                       Agreement. Offer 
                                                       announced and Tender 
                                                       Offer Memorandum 
                                                       available from the 
                                                       Dealer Manager and the 
                                                       Tender Agent. Notices 
                                                       of Offer published. 
 Wednesday, 23rd            Day 16                     Expiration Deadline 
 February, 2011 at 5.00                                Deadline for receipt by 
 p.m.                                                  the Tender Agent of all 
                                                       Tender Instructions. 
 The Business Day           Day 17                     Announcement of 
 immediately following                                 Acceptance and Results 
 the Expiration Date                                   Announcement by Chess 
                                                       of whether it accepts 
                                                       for purchase the Notes 
                                                       validly tendered in the 
                                                       Offer and, if so 
                                                       accepted, the aggregate 
                                                       principal amount of 
                                                       Notes accepted for 
                                                       purchase. 
 Friday, 25th February,     Day 18                     Expected Settlement 
 2011                                                  Date Subject to 
                                                       satisfaction of the 
                                                       Settlement Condition, 
                                                       payment of the Purchase 
                                                       Price in respect of the 
                                                       Notes accepted for 
                                                       purchase. Chess will 
                                                       notify Noteholders in 
                                                       the event that the 
                                                       Settlement Condition is 
                                                       not satisfied on the 
                                                       Expected Settlement 
                                                       Date. 
 

The Company may, in its sole discretion (to be exercised with the consent of Haven), extend, re-open, amend, waive any condition of or terminate the Offer at any time (subject to applicable law and as provided in the Tender Offer Memorandum) and the above times and dates are subject to the right of the Company to so extend, re-open, amend and/or terminate the Offer.

Noteholders are advised to check with any bank, securities broker or other intermediary through which they hold Notes when such intermediary would need to receive instructions from a Noteholder in order for that Noteholder to be able to participate in, or (in the limited circumstances in which revocation is permitted) revoke their instruction to participate in, the Offer by the deadlines set out above. The deadlines set by any such intermediary and each Clearing System for the submission and withdrawal of Tender Instructions will be earlier than the relevant deadlines set out above and in the Tender Offer Memorandum.

Unless stated otherwise, announcements in connection with the Offer will be made by the issue of a press release to a Notifying News Service, by delivery of notices to the Clearing Systems for communication to Direct Participants and may also be found on Reuters International Insider Screen. Copies of all announcements, press releases and notices can also be obtained from the Tender Agent, the contact details for which are below. Significant delays may be experienced where notices are delivered to the Clearing Systems and Noteholders are urged to contact the Tender Agent for the relevant announcements during the course of the Offer. In addition, Noteholders may contact the Dealer Manager for information using the contact details below.

Noteholders are advised to read carefully the Tender Offer Memorandum for full details of and information on the procedures for participating in the Offer.

Other offers

On the date of this announcement:

(i) Green Island Capital Securities p.l.c. launched a tender offer in respect of its outstanding perpetual tier-1 pass-through securities on the terms set out in a tender offer memorandum of even date herewith and Haven has agreed to purchase a corresponding number of the Parity Capital Securities from it; and

(ii) EBS launched a tender offer in respect of any and all of its outstanding lower tier-2 securities on the terms set out in a tender offer memorandum of even date herewith.

Further information

J.P. Morgan Securities Ltd. is acting as Dealer Manager for the Offer and Lucid Issuer Services Limited is acting as Tender Agent.

Questions and requests for assistance in connection with the Offer may be directed to the Dealer Manager.

 
                 The Dealer Manager 
             J.P. Morgan Securities Ltd. 
                   125 London Wall 
                   London EC2Y 5AJ 
                    United Kingdom 
  For information by telephone: [phone] 
  Attention: Sebastien Bamsey - Liability Management 
        Email: [e-mail] 
  For information by telephone: [phone] 
      Attention: Dimis Theodorou - FIG Syndicate 
          Email: [e-mail] 
 

Requests for information in relation to the procedures for tendering Notes in, and for any documents or materials relating to, the Offer should be directed to the Tender Agent.

 
           The Tender Agent 
     Lucid Issuer Services Limited 
              Leroy House 
             436 Essex Road 
             London N1 3QP 
      Telephone: [phone] 
      Facsimile: [phone] 
  Attention: Yves Theis / Lee Pellicci 
       Email: [e-mail] 
 

The Trustee has not been involved in the formulation of the information outlined herein. The Trustee is not responsible for the accuracy, completeness, validity or correctness of the statements made herein.

DISCLAIMER This announcement must be read in conjunction with the Tender Offer Memorandum. This announcement and the Tender Offer Memorandum contain important information which should be read carefully before any decision is made with respect to any Offer. If you are in any doubt as to the action you should take, you are recommended to seek your own financial advice, including as to any tax consequences, from your stockbroker, bank manager, solicitor, accountant or other independent financial, tax or legal adviser. Any individual or company whose Notes are held on its behalf by a broker, dealer, bank, custodian, trust company or other nominee must contact such entity if it wishes to tender such Notes pursuant to the Offer. None of the Company, EBS, Haven, the Dealer Manager or the Tender Agent makes any recommendation whether Noteholders should tender Notes pursuant to the Offer.

OFFER AND DISTRIBUTION RESTRICTIONS

The distribution of this announcement and the Tender Offer Memorandum in certain jurisdictions may be restricted by law. Persons into whose possession this announcement and/or the Tender Offer Memorandum comes are required by the Company, EBS, Haven, the Dealer Manager and the Tender Agent to inform themselves about and to observe any such restrictions. Neither this announcement nor the Tender Offer Memorandum constitutes an offer to buy or a solicitation of an offer to sell the Notes (and tenders of Notes in the Offer will not be accepted from Noteholders) in any circumstances in which such offer or solicitation is unlawful. In those jurisdictions where the securities, blue sky or other laws require the Offer to be made by a licensed broker or dealer and the Dealer Manager or any of its affiliates is such a licensed broker or dealer in any such jurisdiction, the Offer shall be deemed to be made by the Dealer Manager or affiliate, as the case may be, on behalf of the Company in such jurisdictions.

United States. The Offer is not being made, and will not be made, directly or indirectly in or into, or by use of the mails of, or by any means or instrumentality of interstate or foreign commerce of or of any facilities of a national securities exchange of, the United States. This includes, but is not limited to, facsimile transmission, electronic mail telex, telephone, the internet and other forms of electronic communication. The Notes may not be tendered in the Offer by any such use, means, instrumentality or facility from or within the United States or by persons located or resident in the United States. Accordingly, copies of the Tender Offer Memorandum and any other documents or materials relating to the Offer are not being, and must not be, directly or indirectly mailed or otherwise transmitted, distributed or forwarded (including, without limitation, by custodians, nominees or trustees) in or into the United States or to any U.S. persons or any persons located or resident in the United States. Any purported tender of Notes pursuant to the Offer resulting directly or indirectly from a violation of these restrictions will be invalid and any purported tender of Notes made by a person located in the United States or any agent, fiduciary or other intermediary acting on a non-discretionary basis for a principal giving instructions from within the United States will be invalid and will not be accepted.

Each Noteholder participating in the Offer will represent that it is not a U.S. person, it is not located in the United States and it is not participating in the Offer from the United States or it is acting on a non-discretionary basis for a principal that is not a U.S. person, that is located outside the United States and that is not giving an order to participate in the Offer from the United States. For the purposes of this and the above paragraph, United States means United States of America, its territories and possessions (including Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island and the Northern Mariana Islands), any state of the United States of America and the District of Columbia.

Italy. The Offer is not being made, directly or indirectly, in the Republic of Italy (Italy). The Offer and the Tender Offer Memorandum have not been submitted to the clearance procedures of the Commissione Nazionale per le Societa e la Borsa (CONSOB) pursuant to Italian laws and regulations. Accordingly, Noteholders are notified that, to the extent Noteholders are located or resident in Italy, the Offer is not available to them and they may not tender Notes in the Offer and, as such, any Tender Instructions received from such persons shall be ineffective and void, and neither the Tender Offer Memorandum nor any other documents or materials relating to the Offer or the Notes may be distributed or made available in Italy.

United Kingdom. The communication of the Tender Offer Memorandum and any other documents or materials relating to the Offer is not being made, and such documents and/or materials have not been approved, by an authorised person for the purposes of section 21 of the Financial Services and Markets Act 2000. Accordingly, such documents and/or materials are not being distributed to, and must not be passed on to, the general public in the United Kingdom. The communication of such documents and/or materials as a financial promotion is only being made to (i) persons who are outside the United Kingdom, (ii) investment professionals (as defined in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the Financial Promotion Order)), (iii) persons falling within Article 43(2) of the Financial Promotion Order, or (iv) any other persons to whom it may otherwise lawfully be communicated (all such persons together being referred to as Relevant Persons). Any person in the United Kingdom who is not a Relevant Person should not act or rely on such documents or materials or any of their content. Any investment or investment activity to which these documents or materials relate is available only to Relevant Persons and will be engaged in only with Relevant Persons. The documents and materials and their contents should not be distributed, published or reproduced (in whole or in part) or disclosed by recipients to any other person in the United Kingdom.

Belgium. Neither the Tender Offer Memorandum nor any other documents or materials relating to the Offer have been submitted to or will be submitted for approval or recognition to the Belgian Banking, Finance and Insurance Commission (Commission bancaire, financiere et des assurances/Commissie voor het Bank-, Financie- en Assurantiewezen) and, accordingly, the Offer may not be made in Belgium by way of a public offering, as defined in Article 3 of the Belgian Law of 1st April, 2007 on public takeover bids or as defined in Article 3 of the Belgian Law of 16th June, 2006 on the public offer of placement instruments and the admission to trading of placement instruments on regulated markets, each as amended or replaced from time to time. Accordingly, the Offer may not be advertised and the Offer will not be extended, and neither the Tender Offer Memorandum nor any other documents or materials relating to the Offer (including any memorandum, information circular, brochure or any similar documents) has been or shall be distributed or made available, directly or indirectly, to any person in Belgium other than "qualified investors" in the sense of Article 10 of the Belgian Law of 16th June, 2006 on the public offer of placement instruments and the admission to trading of placement instruments on regulated markets (as amended from time to time), acting on their own account. Insofar as Belgium is concerned, the Tender Offer Memorandum has been issued only for the personal use of the above qualified investors and exclusively for the purpose of the Offer. Accordingly, the information contained in the Tender Offer Memorandum may not be used for any other purpose or disclosed to any other person in Belgium.

France. The Offer is not being made, directly or indirectly, to the public in the Republic of France (France). Neither the Tender Offer Memorandum nor any other document or material relating to the Offer has been or shall be distributed to the public in France and only (i) providers of investment services relating to portfolio management for the account of third parties (personnes fournissant le service d'investissement de gestion de portefeuille pour compte de tiers) and/or (ii) qualified investors (investisseurs qualifies), other than individuals, acting for their own account, all as defined in, and in accordance with, Articles L.411-1, L.411-2, D.411-1 to D.411-3, D.734-1, D.744-1, D.754-1 and D.764-1 of the French Code monetaire et financier, are eligible to participate in the Offer. The Tender Offer Memorandum has not been and will not be submitted for clearance to nor approved by the Autorite des Marches Financiers.

Ireland. The Tender Offer Memorandum and any other documents or materials relating to the Offer will only be distributed in conformity with the provisions of (i) the European Communities (Markets in Financial Instruments) Regulations 2007 (Nos. 1 to 3), including, without limitation, Regulations 7 and 152 thereof, or any applicable provisions of Irish law and (ii) the Irish Market Abuse (Directive 2003/6/EC) Regulations 2005 and any rules issued by the Financial Regulator pursuant thereto.

This announcement has been issued through the Companies Announcement Service of

The Irish Stock Exchange.

This information is provided by RNS

The company news service from the London Stock Exchange

END

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